RIM to cut 40% of workforce as another top exec resigns

As ailing Research in Motion prepares to axe nearly 40 percent of its workforce in the coming months, another top-level executive has announced their resignation on Monday as the BlackBerry maker continues to hemorrhage cash.

Canada-based RIM lost its top lawyer on Monday when Chief Legal Officer Karima Bawa announced she would resign, with her departure adding to the rising count of high-level executives leaving the company, reports Reuters.

Bawa's resignation is the second in as many weeks and follows that of Managing Director of Global Sales and Regional Marketing Patrick Spence. In early April, it seemed that Spence would be staying, but the situation at RIM was apparently too dire for him to remain.

A statement from RIM noted that Bawa, who has worked for the company since 2000, would be staying on long enough to hire and transition a suitable replacement.

The Waterloo, Ontario company is expected to cut a massive number of jobs through the year in tandem with launching new handsets built around the next-generation BlackBerry 10 operating system. According to sources familiar with the matter, RIM is looking to bring down its existing global workforce of 16,500 employees to about 10,000 by early next year. The layoffs will affect the company's legal, marketing, sales, operations, and human resources divisions, a source said.

CEO Thorsten Heins, who replaced co-CEOs Mike Lazaridis and Jim Balsillie in January, is looking to salvage what is left of the once dominant smartphone maker and part of that change necessitates the huge layoffs.

RIM headquarters in Waterloo, Ontario. | Source: The Globe and Mail

RIM stock has plummeted some 75 percent over the past year as its share of the smartphone market dwindles against heavy competition from Apple's iPhone and handsets running Google's Android. According to the latest IDC data, BlackBerry shipments only accounted for 6.4 percent of the global market while Android and iOS took a combined 82 percent, shipping 89.9 million and 35.1 million units, respectively.

Failure is an absolutely natural outcome for any company out there; in fact, the principle of limited corporate life is at the core of any basic economics and/or law course at university level.

RIM fell because of mismanagement, lack of innovation and overall lax behavior, where they presumed that their extremely comfortable position in business telephony would continue forever (just like Nokia in the consumer segment).

Alas, in a world of (almost) unrestricted competition, it is more than obvious that some shall suffer while others thrive. Remember Apple in the late 90s? I do; absolutely every single media outlet out there proclaimed them dead - only to see the company come back with a vengeance. As for the now-unemployed people, I am sure most of them will be able to find a better job elsewhere (if they are qualified, bien sūr) - maybe not in Canada (a place not widely known for innovation, let's be clear); but most labor markets are global nowadays anyway.

There is a shortage of skilled software developers in Canada right now. Any one with decent skills are being snapped up quickly. My employer has been interviewing for weeks, and all of the good candidates are sitting on a few offers by the time they see us. RIM does have a lot of good talent, I wouldn't be worried about those with useable skills.

I'm sure all the people recently out of a job will appreciate your wonderful post. Companies falling like this is never a good thing and does nothing to make the industry better.

Actually companies failing like this are a very good thing. You can't concern yourself with the employees, finding work is their business. Just imagine how much better off the world would be if GM and Chrysler had gone under. We might actually have business in Detroit innovating with respect to transportation. Instead we have the same old corporations invested with bad unions and zero innovation.

Your perspective here is totally screwed, this is exactly what business needs right now. It effectively frees up a great deal of talent that has be squandered by RIM and allows that talent to seed innovation elsewhere. Frankly you need to research your position a bit.

Your perspective here is totally screwed, this is exactly what business needs right now. It effectively frees up a great deal of talent that has be squandered by RIM and allows that talent to seed innovation elsewhere. Frankly you need to research your position a bit.

lol ok, thanks for your input. Competitors leaving the market is a great thing...can't believe I never saw it before!! Thanks for teaching me :)